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Politics : Stockman Scott's Political Debate Porch -- Ignore unavailable to you. Want to Upgrade?

To: abuelita who wrote (6048)	9/10/2002 7:01:06 PM
From: stockman_scott	Respond to of 89467

Software Sector: Software stocks have gone in the tank this year. In fact, a look at the Computer Software Index illustrates that the group has been cut in half -- literally -- since the beginning of the year. If you go back to its all-time high in March 2000, the index has given back about 85% of its former total value. While valuations are now more realistic, a continued lack of visibility leaves us unenthused about the sector's prospects. Over the most recent quarter, concerns over the macroeconomic outlook and weakness across the broader markets have served as challenges for the group. While it looks like the U.S. business climate is not getting worse, there are signs European business continues to soften. Nonetheless, a new emphasis on security remains evident which should feed into upgrades on related system requirements. The sector also has several product-specific dynamics that should drive key names in the group. Sector leader Microsoft has two key product launches underway with Windows XP and its video game console the X-Box. Both have fared well early in their product cycles and strong unit sales for the X-Box should in turn drive demand for video game software sales. In the end, the sector appears to be situated so that valuations are relatively attractive while at the same time, questions regarding visibility continue to surface. After weighing both sides of the equation with an emphasis on the longer-term outlook, we are retaining our rating at Market Perform (see Sector Ratings for more sector coverage). -- Mike Ashbaugh, Briefing.com 10-Sep-02